§ 176 but not of H. B., who only promises to pay if J. C. does not: Ferris v. Bond, 4 B. & Ald., 679 (1821).

Endorsed

by maker.

Pledge.

12. A banker's deposit receipt for money "to account for on demand" Hopkins v. Abbott, L. R. 19 Eq. 222 (1875).

2. An instrument in the form of a note payable to the maker's order is not a note within the meaning of this section, unless it is endorsed by the maker. 53 V., c. 33, s. 83 (2). Imp. Act, s. 84 (2).

When such a note is indorsed in blank it becomes a note payable to bearer: Burns v. Harper, 6 U. C. Q. B. 509 (1849); Wallace v. Henderson, 7 U. C. Q. B. 88 (1849); Ennis v. Hastings, 9 N. B. (4 Allen) 482 (1860); Hooper v. Williams, 2 Ex. 13 (1848); Brown v. De Winton, 6 C. B. 336 (1848); Masters v. Baretto, 8 C. B. 433 (1849). If indorsed specially it becomes a note payable to the indorsee: Gay v. Lander, 6 C. B. 336 (1848); Moses v. Lawrence County Bank, 149 U. S. 298 (1892).

3. A note is not invalid by reason only that it Invalidity. contains also a pledge of collateral security with authority to sell or dispose thereof. 53 V., c. 33, s. 82 (3). Imp. Act, s. 84 (3).

This sub-section is a modification of the rule in section 17 (2), that an instrument which orders anything to be done in addition to the payment of money, is not a bill. See Chesney v. St. John, 4 Ont. A. R. 150 (1879); Wise v. Charlton, 4 A. & E. 786 (1836); Fancourt v. Thorne, 9 Q. B. 312 (1846).

Another modification is that which allows a clause to be inserted, where there are two or more parties to a note bearing the relation of joint debtors or of principal and surety, allowing time to be given, or arrangements to be entered into with one without releasing the other or others: Yates v. Evans, 61 L. J. Q. B. 446 (1882); Kirkwood v. Carroll, [1903] 1 K. B. 531. See p. 56.

There has also been a conflict of authority as to whether ⚫ lien notes such as are frequently taken for implements and

other articles, providing that the title to the articles shall § 176 remain in the vendors until the note is paid, are negotiable promissory notes. For cases on both sides, see illustration No. 3, ante p. 55.

Where collateral security is given with a note, the right to such collateral goes with the note: Central Bank v. Garland, 20 O. R. 142 (1890); Vezina v. Maltais, 10 Rev. de Jur. 301 (1904). See Cochrane v. Boucher, 3 O. R. at p. 472 (1883). This is the law in France: Nouguier, § 715.

The creditor has a right to hold the securities even after the remedy on the note is barred by the Statute of Limitations: Wiley v. Ledyard, 10 Ont. P. R. 182 (1883).

When a note on its face contains a statement that it is given as collateral security, it is not a promissory note: Hall v. Merrick, 40 U. C. Q. B. 566 (1877); Sutherland v. Patterson, 4 0. R. 565 (1884).

The contrary has been held in Australia. In Lipscomb v. Matton, 15 N. S. W. R. (Law) 362 (1894), it was decided that the words, "this being collateral security to a mortgage given,” etc., did not import a condition that the promissory note was only payable in the event of the mortgage not being paid.

note.

177. A note which is, or on the face of it pur- Inland ports to be both made and payable within Canada, is an inland note.

2. Any other note is a foreign note. c. 33, s. 82 (4). Imp. Act, s. 83 (4).

53 V., Foreign

The Imperial Act uses the words "within the British Islands."

If dated abroad and payable in Canada, a note would still be an inland note if actually made or issued in Canada. On the other hand, if dated in Canada and payable there, it would be an inland note, although actually made or issued abroad. The distinction is of consequence for the purposes of protest. An inland note need not be protested except in Quebec, notice of dishonour being sufficient to bind en

note.

$ 177 dorsers in the other provinces: secs. 113 and 186. To bind the endorsers of a foreign note protest is necessary in any part of Canada: sec. 187.

Inland or foreign.

Delivery.

Joint and several note.

Joint liability in Quebec.

A note dated in Halifax, N.S., and payable there, is an inland note, although made in France: Merchants' Bank v. Stirling, 13 N. S. (1 R. & G.) 439 (1880).

See section 25 relating to inland bills and the notes thereon.

178. A promissory note is inchoate and incomplete until delivery thereof to the payee or bearer. 53 V., c. 33, s. 83. Imp. Act, s. 84.

This was the old law: Chapman v. Cottrell, 3 H. C. 865 (1865). Delivery is necessary to give effect to any contract on a bill or note: sec. 39.

It becomes a note on delivery to the second party to it. Delivery is the transfer of possession, actual or constructive, from one person to another: sec. 2 (f). The nature of the delivery necessary to give effect to a note is set out in section 40.

179. A promissory note may be made by two or more makers, and they may be liable thereon jointly, or jointly and severally, according to its tenor. 53 V., c. 33. s. 84 (1). Imp. Act, s. 85 (1).

This section brings up some interesting questions on account of the difference between the law of Quebec and that of the other provinces as to the nature of a joint contract, or joint liability, as distinguished from that which is joint and several.

Under the French law, in force in Quebec, where several persons are jointly liable for a debt, each of them is liable for an equal fractional part to the creditor, whatever may be their respective rights as against each other. Thus, if two are jointly bound, each is liable for one-half; if there are three, each is liable for one-third, and so on; and no one of them by the death of his co-debtor or otherwise becomes

liable for more, the liability of the deceased passing to his § 179 legal representatives. The advantage to a creditor in having In Quebec. a joint contract instead of so many separate contracts is that he may sue all in one action, obtaining a separate condemnation of each for his equal share. See Pothier on Obligations, No. 165; 17 Laurent, Nos. 274, 280. An obligation is presumed to be joint, unless expressly declared to be joint and several. This rule does not apply to commercial transactions, where the presumption is in favor of the liability being joint and several: C. C. Art. 1105.

other Pro

Under English law, on the other hand, each joint debtor In the is liable to the creditor for the whole. If one dies, his re- vinces. presentatives are not liable for any part to the creditor. If the creditor does not sue all who are alive and in the country, those who are sued might, upon a plea in abatement, under the old system of pleading, or by a motion under the Judicature Act, have proceedings stayed, until the living joint debtors who are in the country are made parties. A judgment taken against some of the joint debtors, even without satisfaction, frees the others from all liability: King v. Hoare, 13 M. & W. 494 (1844); Kendall v. Hamilton, 4 App. Cas. 504 (1879); Hammond v. Schofield, [1891] 1 Q. B. 453; Hoare v. Niblett, [1891] 1 Q. B. 781; Toronto v. Maclaren, 14 Ont. P. R. 89 (1890); McDonald v. McGillis, 33 N. S. 244 (1900); Leake on Contracts, p. 297.

In Ontario by R. S. O. c. 129, s. 15, in Manitoba by R. S. M. c. 170, s. 61, and in the N. W. Territories by the Trustee Ordinance, 1903, s. 34, the common law rule as to joint debtors has been modified by providing that in case one or more of them dies his or their representatives may be proceeded against as if the contract had been joint and several.

If a note is on its face "joint," and not joint and several, the law would differ as above, according to whether it is a Quebec note or not. The note would be interpreted according to the law of the place where it was made: sec. 161; that is, where it was delivered to the payee or bearer: sec. 178.

In Cook v. Dodds, 6 O. L. R. 608 (1903), the representatives of a deceased joint maker of a note were sued. They

Joint liability.

§ 179 claimed that the liability being joint did not survive the death, and that a provincial statute could not vary the Bills of Exchange Act. It was held that the Dominion Act did not deal with the consequences which flow from a joint or joint and several liability; but that this was to be determined. by the law of the province where the liability was sought to be enforced, and that R. S. O. c. 129, s. 15, above referred to, governed.

In the province of Quebec in the case of Crépeau v. Beauchesne, Q. R. 14 S. C.-495 (1898), one of two joint makers was held liable for the whole amount of a note, as having incurred a joint liability as understood in English law. In a later case, Noble v. Forgrave, Q. R. 17 S. C. 234 (1899), it was held that section 8 of the amending Act of 1891 (sec. 10 of the present Act), had introduced into Quebec the law of England on this point, modifying, as to bills and notes, the provisions of Article 1105 of the Civil Code, which declares that in commercial matters the liability is presumed to be joint and several. The two makers were consequently condemned jointly, that is, each for one-half. Before the Act the decisions in Quebec on the point were conflicting. After the abolition of the distinction between traders and non-traders with regard to negotiable notes, it was generally considered that every negotiable note was a commercial transaction, and that under Art. 1105 C. C., the makers were jointly and severally liable: Perrault v. Bergevin, 14 R. L. 604 (1886). In Malhiot v. Tessier, 2 R. L. 625 (1870), however, it was held that two farmers who had signed a note were liable only jointly, and this doctrine has been confirmed by Drouin v. Gauthier, cited below and followed in Dagneau v. Décaire, 5 Que. P. R. 141 (1906), where a husband and wife, non-traders, signed a note together, it was held that their obligation was joint, and not joint and several, and the wife not being liable on account of the Code prohibiting her from binding herself with her husband, he alone was liable, and only for half the note.

Under English law, a note signed by several makers, not partners, which reads "we promise," is joint: Byles, p. 8; Chalmers, p. 271; 1 Daniel, § 94; White v. Tyndall, 13 A. C. 263 (1888). The liability of partners is also joint,